The Government Will Make the Price of Gold Go Up

There�s certainly some Central Bank manipulation. There�s some fundamental reasons having to do with what we�ve been talking about, which is deflation.

Gold should go down in a deflation environment initially. But if deflation gets bad enough, the government will make the price of gold go up because they get desperate to create inflation.
If you�ve tried everything, if you want inflation, and you�ve tried everything to create it, so you tried money printing, cutting rates, currency wars, Operation Twist, QE, forward guidance, nominal GDP targeting, you�ve tried everything, you still didn�t get the inflation. There�s one thing that always works, which is devaluing your currency against gold.

So there could come a time when deflation gets so bad that the Fed and the treasury actually raise the price of gold, not to enrich gold investors, but to get close to generalized inflation. Because if gold goes up, silver and oil will go up along with it. It�s exactly what happened in 1933.

So that�s one path. But the other, perhaps more likely path, is that the Fed just keeps printing money and finally succeeds in changing behavior, velocity of the turnover money picks up and inflation goes up on its own. Then gold will race way ahead of that. That�ll just change the psychology.

- Source, Jim Rickards via Future Money Trends:

http://futuremoneytrends.com/blog/?p=10062

Gold Confiscation is Very Unlikely

There isn't a central bank in the world that wants to go back to a gold standard. But that�s not the point. The point is whether they will have to.

I've had conversations with several of the Federal Reserve Bank presidents. When you ask them point-blank, �Is there a theoretical limit to the Fed�s balance sheet?� they say no. They say there are policy reasons to make it higher or lower, but that there�s no limit to the amount of money you can print.

That is completely wrong. That�s what they say; that�s how they think; and that�s how they act. But in their heart of hearts, some people at the Fed know it�s wrong. Luckily, people can vote with their feet.

I always tell people who say we�re not on the gold standard that, in a way, we are. You can put yourself on a personal gold standard just by buying gold. In other words, if you think that the value of paper money will be in some jeopardy, or confidence in paper money may be lost, one way to protect yourself is by buying gold, and there�s nothing stopping you.

The typical rejoinder is, �What�s the point of owning gold? They�re just going to confiscate it, like Roosevelt did in 1933?�

I find that extremely unlikely.

- Source, Wall Street Pit:

http://wallstreetpit.com/100623-your-personal-gold-standard/